Thetrader.se
The extended Santa Rally has surprised many. With the light volume melt up, many are rather confused at these levels. Shorts sweating, longs enjoying, but want to exit fast, if this turns lower. Volatility has collapsed, and people now hate anything called theta. HFT still dominating the market. These are all ingredients for some very interesting action going forward. All indices look rather toppish and some key indices are hitting major resistance levels. Below are essential charts. http://www.thetrader.se/2012/01/23/chart-porn/ [52]
Ft.com
Italian Prime Minister Mario Monti on Sunday sought to reassure his government was taking austerity plans forward, the WSJ reports, saying on state television that plans to spin off Eni’s regulated natural gas business were going ahead.http://ftalphaville.ft.com/thecut/2012/01/23/844471/monti-emphasises-pro... [53]
Nearly half of Asia’s larger companies are planning to make a significant acquisition in Europe over the next year, drawn by the availability of cheap assets amid the eurozone crisis, according to a survey by FTI Consulting,http://ftalphaville.ft.com/thecut/2012/01/23/844331/larger-asian-compani... [54]
The European Central Bank has removed almost a third of the bank debt it added three weeks ago to the list of assets against which it would lend, the FT says, after discovering that many of the instruments may not meet its requirements.http://ftalphaville.ft.com/thecut/2012/01/23/844441/ecb-slashes-list-of-... [55]
Eurozone finance ministers will on Monday decide what terms they will accept on a Greek debt restructuring after talks going into the weekend failed to reach agreement, reports Reuters. The mood in Athens was tense on Sunday night, http://ftalphaville.ft.com/thecut/2012/01/23/844181/greek-bondholders-dr... [56]
More than two-thirds of hedge funds are below their high-water marks, the point at which they are able to charge investors performance fees, according to Credit Suisse. The FT says the main source of income for hedge fund managers is their share of investment profits,http://ftalphaville.ft.com/thecut/2012/01/23/844341/hedge-funds-fall-sho... [57]
France and Germany are to call for a relaxation of global bank capital rules to prevent lending to the real economy being choked off, setting them at odds with the UK’s stricter approach to banks. A joint paper by Wolfgang Schäuble, http://ftalphaville.ft.com/thecut/2012/01/23/844031/paris-and-berlin-see... [58]
Ikea is withholding its entry into India despite New Delhi’s move to open its market to foreign retailers, Mikael Ohlsson, chief executive, told the FT. Mr Ohlsson said that India’s requirements http://ftalphaville.ft.com/thecut/2012/01/23/843981/ikea-to-stay-out-ind... [59]
The Arab League will seek UN Security Council endorsement for a plan to peacefully end the rule of Syrian President Bashar al-Assad and pave the way for a democratically elected government within six months. The announcement near midnight on Sunday of the plan followed a marathon day of closed-door meetings of Arab ministers trying to end the spiraling violence between the Mr Assad’s regime, which has used brute force to crush a nationwide protest movement, and government opponents increasingly resorting to an armed struggle.http://www.ft.com/intl/cms/s/0/5444c700-44f0-11e1-be2b-00144feabdc0.html... [60]
Wsj.com
Asian stock markets were mixed Monday as investors weighed some positive U.S. earnings reports against continued uncertainty over the ongoing sovereign-debt crisis in Europe. Trade was tepid with most regional markets shut for the Lunar New Year holiday. Japan’s Nikkei Stock Average rose 0.2%, Australia’s S&P/ASX 200 slipped 0.3%, and New Zealand’s NZX-50 gained 0.4%. India’s Sensex was down 0.1% and Thai shares rose 0.4%. Dow Jones Industrial Average futures were down 18 points in screen trade. Most tech plays were higher in Tokyo following positive earnings results from their U.S. counterparts. Elpida Memory advanced 4.6%, Sony climbed 4.8% and Toshiba rose 4.3%.http://online.wsj.com/article/SB1000142405297020380650457717784017402244... [61]
French Socialist Party candidate François Hollande sought to cement his lead over President Nicolas Sarkozy in opinion polls, positioning himself resolutely to the left three months ahead of the election. Mr. Hollande said on Sunday that some of his first actions, were he to win the presidential election, would be to shackle the world of finance—which he described as his “main foe”—and raise taxes on the rich. “Each country has a soul,” Mr. Hollande told a 10,000-strong crowd of Socialist faithful gathered in the airport city of Le Bourget, near Paris. “And France’s soul is equality.”http://online.wsj.com/article/SB1000142405297020371850457717722062220021... [62]
U.K. Prime Minister David Cameron will Monday offer cheap rent in empty state-owned buildings to small British firms as the government races to find new initiatives to foster growth ahead of the release of statistics this week that are expected to show the U.K. economy shrank in the fourth quarter. On a visit to Leeds, in the northeast of England, the prime minister will say that more than 300 buildings in the central government’s estate across the country will be made available to small businesses at a low cost.http://online.wsj.com/article/SB1000142405297020371850457717706146381958... [63]
Germany rejected calls for boosting the size of the planned euro-zone bailout fund, even as talks on restructuring Greek debt stalled over the weekend and raised the specter of a possible Greek default. European demands to ensure that the European Stability Mechanism, the permanent bailout fund that is expected to be launched in July, has sufficient firepower to stop the spread of financial contagion in the event of a Greek default is likely to dominate a series of talks this week between Chancellor Angela Merkel and European leaders and international officials. Italian Prime Minister Mario Monti has demanded that Germany do more to finance the euro-zone rescue. Now, according to an unconfirmed report in the German weekly magazine Der Spiegel, Mr. Monti and European Central Bank President Mario Draghi are calling for doubling the volume of the ESM to €1 trillion ($1.293 trillion) from the planned €500 billion.http://online.wsj.com/article/SB1000142405297020371850457717693307797520... [64]
Doubts over European and U.S. consumers’ appetite for chocolate have interrupted a rally by cocoa, but the market is expected to heat up again despite a shaky economic outlook. Two weeks ago, cocoa futures traded on the ICE Futures U.S. exchange appeared poised to reach $2,400 a ton, a level last seen in mid-November. Cocoa’s rise, driven by concern over the availability of supplies, was derailed by indications that growth in demand for chocolate had slowed.http://online.wsj.com/article/SB1000142405297020375040457717324186489392... [65]
Marketwatch.com
Australia’s fourth-quarter final producer price index rose 0.3%, according to data released Monday by the Australian Bureau of Statistics. Economists had been expecting a rise of 0.4% in the October-December period, according to data compiled by Dow Jones Newswires. On an annual basis, PPI rose 2.9%.http://www.marketwatch.com/story/australia-fourth-quarter-final-ppi-up-0... [66]
OPEC’s secretary general was quoted Saturday as saying $100 a barrel is now an acceptable price for producers and consumers and doesn’t hurt the economy, days after the cartel’s kingpin, Saudi Arabia, said it also favored current price levels. But in an interview with Austria newspaper Kurier, Abdalla Salem el-Badri also warned against blocking the Strait of Hormuz, a key Middle-Eastern oil route which OPEC member Iran has threatened to close.http://www.marketwatch.com/story/opec-100-oil-acceptable-to-producers-co... [67]
Russia’s acceptance into the World Trade Organization last month didn’t just mark an end to nearly two decades of negotiations, but opened a door to free up global trade with a nation that is one of the world’s largest oil producers and home to the globe’s biggest natural gas reserves. And if the impact on the last large economy to join the organization — China — offers any clue, the outlook for Russian trade and its economy has much improved. On Dec. 16, the World Trade Organization approved Russia’s membership. WTO trade ministers have said Russia’s accession to the organization will bring the nation more firmly into the global economy and make it a more attractive place to do business. http://www.marketwatch.com/story/russias-wto-entrance-redraws-global-res... [68]
Reuters.com
Gold rose more than half a percent on Monday, tracking Tokyo futures higher in thin trade, but gains could be limited by a weaker euro after Greece and its private creditors failed to strike a crucial deal to avoid a messy default. Gold rose 0.62 percent to $1,667.99 an ounce by 0237 GMT as gains on Tokyo futuresspilled into the cash market. Gold has risen more than 6 percent so far this year, but stayed below a lifetime high of around $1,920 hit last September.http://www.reuters.com/article/2012/01/23/us-markets-precious-idUSTRE7AK... [69]
Brent crude futures held steady around $110 on Monday as concerns about European demand countered worries about supply disruptions from the Middle East due to simmering tensions between the West and Iran. Front-month Brent rose 25 cents to $110.11 a barrel by 0431 GMT, trading in a narrow range. U.S. crude fell 20 cents to $98.13, after sliding to as low as $97.40, the lowest since December 21. http://www.reuters.com/article/2012/01/23/us-markets-oil-idUSTRE7AD06820... [70]
Bloomberg.com
Betting against the euro may be the most profitable trade in the foreign-exchange market as policy efforts to stave off a European recession debases the currency. Borrowing in euros and investing in the currencies of Australia, Brazil, Mexico, South Africa and South Korea has returned 8 percent since theEuropean Central Bank cut its benchmark interest rate on Nov. 3 for the first time in more than two years, according to data compiled by Bloomberg. So- called carry trades funded with yen have lost 0.3 percent and gained 1 percent when financed with dollars. http://www.bloomberg.com/news/2012-01-22/draghi-makes-euro-favorite-for-... [71]
The British government’s plan to help reduce down payments for new homes to as low as 5 percent will give a boost to a homebuilding industry that’s learned how to survive a slowing economy and four years of stingy credit. Mortgage lending is less than half the level of 2006, at the end of the housing boom, with buyers now required to pay as much as 25 percent of a home’s value up front. The program would lower that by providing a guarantee, shared by the government and builders, to protect lenders from some losses in a default.http://www.bloomberg.com/news/2012-01-23/homebuilders-get-cameron-boost-... [72]
Cnbc.com
Market participants are divided on whether the Federal Reserve will ease again, but have grown somewhat more optimistic about the economy, according to the January CNBC Fed Survey. About half of survey respondents believe there will be a third round of quantitative easing from the Fed in the next year, unchanged from October; 44 percent say it’s not in their forecast and 8 percent are unsure. “QE3 is not necessary and could be counterproductive to achieving the Fed’s dual mandate,” PNC economist Stuart Hoffman wrote. He was one of 75 economists, equity, and bond-fund managers and analysts to respond to the CNBC survey. http://www.cnbc.com/id/46075671 [73]
USAtoday.com
The U.S. economy will slow this year after a flurry of stronger growth in late 2011, leaving the 8.5% unemployment rate about where it is now on Election Day, according to USA TODAY’s quarterly survey of economists. The economy will slow to 2.2% annual growth in the first half of 2012 after an estimated 3.1% gain in fourth-quarter gross domestic product, according to the median forecast of the 48 economists surveyed. The biggest reason for slower growth is that a late-2011 bounce back from the effects of the Japanese earthquake last March won’t last, according to Diane Swonk, chief economist at Mesirow Financial. Slower growth will help keep unemployment at 8.4% or higher through year’s end, economists predict.http://www.usatoday.com/money/economy/story/2012-01-22/economic-survey-u... [74]
Washingtonpost.com
Speculators raised bets on higher metal prices by the most since July, turning bullish on copper for the first time in four months on signs of growth in the U.S., increasing demand in China and more confidence in Europe. Money managers expanded combined net-long positions in five industrial and precious metals by 13 percent to 152,665 futures and options in the week ended Jan. 17, Commodity Futures Trading Commission data show. They are now the most bullish on copper since August. Traders increased holdings in silver, the precious metal most used in industry, to the highest since November. Wagers on rising gold prices advanced the most in two months. http://washpost.bloomberg.com/story?docId=1376-LY6Q0Q1A1I4H01-67I9S8NFOO... [75]
Telegraph.co.uk
Opposition leader Ed Miliband has challenged the Prime Minister to block Royal Bank of Scotland (RBS) chief executive Stephen Hester’s bonus in a move likely to raise eyebrows across the Square Mile. In an interview on Sunday, Mr Miliband called for fresh taxes on bankers’ bonuses. He reserved special criticism for the taxpayer-backed lender and urged David Cameron to intervene. His comments are likely to prove controversial given the fact it was the Labour Party that approved the terms of Mr Hester’s contract and pay when he was appointed in 2008 to replace Sir Fred Goodwin.http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9031483/... [76]
Jobcentre officials have moved hundreds of thousands of unemployed people claiming jobless benefits on to a separate “training allowance” over the past year, raising concerns the Government is “massaging” figures to mask the true extent of unemployment. The Sunday Telegraph can reveal that 218,700 jobseekers were taken off Jobseeker’s Allowance and moved on to training payments of equal value in the year to September 2011, while attending job-hunting courses and classed as officially “employed”.http://www.telegraph.co.uk/finance/jobs/9030020/Secret-jobless-could-mas... [77]
Britain has sunk deeper into debt. Three years after bubble burst, the UK has barely begun to tackle the crushing burden left by Gordon Brown. The contrast with the United States is frankly shocking. The latest report on “Debt and Deleveraging” by the McKinsey Global Institute shows that total public and private debt in the UK is still hovering at an all-time high. It has risen from 487pc to 507pc of GDP since the crisis began. As the chart above shows, as recently as 1990 Britain’s debts were still just 220pc of GDP. Has a rich country ever been debauched so fast in peace time?http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/903147... [78]
Guardian.co.uk
The government faces renewed pressure to announce tough measures on bankers’ pay this week as data shows that the average remuneration for 1,265 senior staff was £1.8m in 2010. The analysis of regulatory disclosures by eight leading banks comes as the business secretary, Vince Cable, prepares to announce on Tuesday how he will tackle the issue of executive pay. Research by the Guardian has found that the average pay deal was £1m or more for employees regarded as having the most influence over risk-taking activities at their firms. The highest average was at Goldman Sachs (£4m) and the lowest at HSBC (£1m), during a year when data from the Office for National Statistics showed the average wage in the UK was £25,900.http://www.guardian.co.uk/business/2012/jan/22/city-banks-reveal-top-pay [79]
Theglobeandmail.com
Bank of Canada governor Mark Carney says the U.S. economy could take years to recover from its current weak state — and may never return to its glory days. “The nature of the U.S. recovery, it’s going to take a number of years before they get back to the U.S. that we used to know,” Mr. Carney told CTV’s Question Period. “In fact, they are not in our opinion ultimately going to get back fully to the U.S. we used to know.” The weakness south of the border is costing the Canadian economy $30 billion annually in lost exports, according to Mr. Carney.http://www.theglobeandmail.com/report-on-business/us-economy-may-never-f... [80]
Straitstimes.com
Russian oil production reached a record 511 million tonnes in 2011, but output levels are unlikely to increase further over the next three years, an official said on Saturday. Mr Sergei Kudriashov, the vice-minister for energy, said the output level was up by about one per cent last year, a record for the post-Soviet period. ‘We understand that in the three coming years, we are going to have a lull in the operation of new deposits,’ he said in comments broadcast on public television station Russia 24. ‘That’s why the principle task now is to use the resources we have and maximise the efficiency of work in old deposits.’http://www.straitstimes.com/BreakingNews/Money/Story/STIStory_758480.htm... [81]
Xinhuanet.com
French Labor Minister Xavier Bertrand said on Sunday he did not expect an “immediate improvement” of the domestic job market hit hard by combined effects of debt crisis and sluggish economy. “There won’t be immediate improvement of the employment issue in the coming months…But we have to avoid that unemployment explodes,” Bertrand said in an interview with the French broadcaster Europe 1. “We need to propose solutions to the unemployed people and also receive them as soon as possible,” he added. http://news.xinhuanet.com/english/world/2012-01/22/c_131373473.htm [82]
Indonesia is going to enjoy more foreign capital inflows as the Southeast Asian largest economy had got credit rating hike to investment grade from two rating agencies, spurring the much-needed infrastructure development in the country. Moody Investor Service on Wednesday upgraded the Indonesian government foreign-and-local currency bond ratings to Baa3 from Ba1, putting Indonesia’s outlook at stable following the similar suite by Fitch’s rating agency on Dec. 15 that raised the country’ s credit rating from BBB- to BB+, putting Indonesia in a par with India. The decisions are taken amid the downgrades of credit rating in countries in Europe. Indonesia had lost the status from both agencies since the Asian financial crisis.http://news.xinhuanet.com/english/business/2012-01/22/c_131373068.htm [83]
Economictimes.com
Drawing flak for project delays, the government has decided to set up a dedicated forum to clear bottlenecks such as coal linkages and environmental and defence clearances that are major holdups.
Top government officials told TOI that after the meeting of the Prime Minister’s Council on Trade and Industry last month, the department of industrial policy and promotion (DIPP) has been asked to identify projects and remove bottlenecks in consultation with other departments and ministries.http://economictimes.indiatimes.com/news/economy/infrastructure/governme... [84]
Yonhapnews.co.kr
South Korea’s jobless rate was the lowest among the world’s major economies in November last year, according to an international report on Sunday. According to the report by the Organization for Economic Cooperation and Development (OECD), South Korea’s seasonally-adjusted unemployment rate stood at 3.1 percent in November, the lowest among the 34 member countries surveyed by the Paris-based organization. South Korea’s November jobless rate compared with an average unemployment rate of 5.1 percent among OECD countries.http://english.yonhapnews.co.kr/business/2012/01/22/39/0501000000AEN2012... [85]
Themoscowtimes.com
In the week through Jan. 11, investment funds focused on Russia experienced an inflow of $43 million, equaling about 0.4 percent of the total amount under management, according to EPFR Global. In the weeks leading up to the New Year, investors had been cashing out of Russia-focused funds. This follows a trend of investors putting money into Russian assets that are part of larger emerging market funds, said Chris Weafer, a strategist at Troika Dialog. “They have increased their Russian assets over the last three weeks, with the inflow as of last week reaching $133 million, or 0.27 percent of the amount under management,” he said. Analysts see this as part of a general change in attitude toward emerging markets, not just Russia. For the week ending last Wednesday, emerging market funds grew by $1.8 billion, Weafer said. “Investors are not betting on specific countries — $1.6 billion of that amount was put into relatively stable and balanced emerging market funds,” he said. http://www.themoscowtimes.com/business/article/russia-again-attracting-i... [86]
Tehrantimes.com
The Iranian economy is set to grow favorably in 2012 despite effects of new sanctions, says the World Bank’s latest Global Economic Prospects (GEP) 2012. Despite the introduction of international sanctions and ripple effects from the global financial crisis, rising oil prices and a good crop helped to support the economy, the Washington-based financial body said.http://www.tehrantimes.com/economy-and-business/94731-iranian-economy-fa... [87]